'5 million SMEs to buy a PC over next 12 months'

Nearly 5 million non-PC companies, or 22 per cent of small enterprises in India, have plans in the next 12 months to invest in computers for the first time. This will also boost investments in other IT categories such as software, services, security, etc, according to a recent study by New York-based Access Markets International (AMI) Partners.

“In the current economic downturn, businesses are looking at cutting costs, and as a result PC-owning small businesses are extending the life-cycle of existing PCs,” said Dipendra Mitra, analyst, AMI-Partners.

“The non-PC businesses hold the key to growth in India. Even if a fraction of the 2.5 million non-PC owning businesses buy a PC, it will provide a considerable boost to the Indian IT industry,” added Mitra.

Currently, only one-third of all small enterprises actually own and use a PC. One key reason for this is the lack of awareness of the benefits of PCs among small businesses. A recent AMI survey found that more than 55 per cent of the small businesses think of PCs as irrelevant to their line of business, and nearly a third have not even considered buying a PC.

“However, this attitude is changing, and about a quarter of these non-PC enterprises now say PCs will make their business look more professional, while a fifth of these say PCs will increase the productivity of their employees, and the resultant business automation will boost efficiency." Mitra said.

AMI surveys have identified a distinct category of non-PC businesses which are categorised as ‘concerned Non-PC small businesses.’ These are defined as small businesses which have expressed their concern over the current economic scenario and state that general business conditions will get worse in the next 12 months. This segment of concerned Non-PC businesses demographically earns higher revenues, makes quick decisions, has a larger branch network, a bigger mobile workforce, and is thus more concerned about the current economic downturn.

According to AMI, 90 per cent of non-PC enterprises in India said they preferred to buy from the local computer store. Retail computer stores offer many advantages, such as convenient options of buying over the counter, selecting from multiple brands and models and a chance to weigh the pros and cons of each PC model or brand.

Local resellers/system builders/box-pushers are the second preferred channel for future PC purchasers among the non-PC businesses. This is mainly due to their personalised service and support.

Correction

The figure 5 million in the story's headline and text is incorrect and should have been half a million. Dipendra Mitra, analyst at AMI-Partners, who has been quoted in the story, clarifies that he had said that there are 2.5 million non-PC small businesses, of which half a million are likely to buy a PC. The error is regretted.